<PAGE>
As filed with the Securities and Exchange Commission on November 12, 1997
Registration No. 333-______
===========================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
ACCLAIM ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
Delaware 38-2698904
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification Number)
One Acclaim Plaza
Glen Cove, New York 11542
(Address of principal executive offices)
-------------------
Acclaim Entertainment, Inc.
1988 Stock Option Plan
(Full title of the plan)
-------------------
Gregory E. Fischbach Copy to:
Chief Executive Officer Jayshree Parthasarathy, Esq.
One Acclaim Plaza Rosenman & Colin LLP
Glen Cove, New York 11542 575 Madison Avenue
(516) 656-5000 New York, New York 10022
(Name, address and telephone (212) 940-8800
number of agent for service)
-------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==================================================================================================================================
Title of Proposed maximum Proposed maximum Amount of
securities to Amount to be offering price aggregate offering registration
be registered registered per share* price* fee
==================================================================================================================================
<S> <C> <C> <C> <C>
Common Stock,
par value $0.02
per share...... 10,000,000 $4.11 $41,100,000 $12,455.00
==================================================================================================================================
</TABLE>
* Estimated solely for the purpose of calculating the registration fee;
computed, pursuant to Rule 457(c), upon the basis of the average of the high and
low prices of the Common Stock as quoted on The NASDAQ Stock Market's National
Market System on November 7, 1997.
==============================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Acclaim Entertainment, Inc. (the "Company") is subject to the
informational requirements of the Securities Exchange Act of 1934 (the "Exchange
Act") and, in accordance therewith, files reports and other information with the
Securities and Exchange Commission (the "Commission"). The following documents,
or portions thereof, filed by the Company with the Commission pursuant to the
Exchange Act are incorporated by reference in this Registration Statement:
(a) Annual Report on Form 10-K for the fiscal year ended
August 31, 1997, filed on November 12, 1997 (File
No. 0-16986); and
(b) The information in respect of the Company's common stock
under the caption "Description of Registrant's Securities to be
Registered" contained in the Registration Statement on Form 8-A filed
on June 8, 1988, as amended by the Current Report on Form 8-K, dated
August 24, 1989, relating to the one-for-two stock split effected by
the Company (File No. 0-16986).
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment hereto indicating that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be a part
of this Registration Statement from the respective dates of filings of such
documents.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Certificate of Incorporation of the Company provides that any
person may be indemnified against all expenses and liabilities to the fullest
extent permitted by the General Corporation Law of the State of Delaware.
Section 145 of the General Corporation Law of Delaware, the law of the
state in which the Company is incorporated, empowers a corporation within
certain limitations to indemnify any person against expenses, including
attorneys' fees, judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with any suit or proceeding to which he
is a party by reason of the fact that he is or was a director, officer, employee
or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, as long as he acted in
good faith and in a manner which he reasonably believed to be in, or not opposed
to, the best
<PAGE>
interests of the corporation. With respect to any criminal
proceeding, he must have had no reasonable cause to believe his
conduct was unlawful.
The Company has in effect directors' and officers' liability insurance.
ITEM 8. EXHIBITS
Exhibit No. Description
----------- -----------
*4(a) - Acclaim Entertainment, Inc. 1988 Stock Option Plan,
as amended and restated.
4(b) - Certificate of Incorporation (incorporated by
reference to Exhibit 3.1 to the Company's
Registration Statement on Form S-1, Registration
No. 33-28274, filed on April 21, 1989, as amended).
4(c) - Amendment to Certificate of Incorporation
(incorporated by reference to Exhibit 3.2 to the
Company's Registration Statement on Form S-1,
Registration No. 33-28274, filed on April 21, 1989,
as amended).
4(d) - Amendment to Certificate of Incorporation
(incorporated by reference to Exhibit 4(d) to the
Company's Registration Statement on Form S-8,
Registration No. 33-59483, filed on May 19, 1995 (the
"Form S-8")).
4(e) - Amended and Restated By-Laws of the Company
(incorporated by reference to Exhibit 4(e) to the
Form S-8).
4(f) - Specimen of common stock certificate of the Company
(incorporated by reference to Exhibit 4.1 to the
Company's Annual Report on Form 10-K for the year
ended August 31, 1991, filed on November 8, 1989, as
amended (File No. 0-16986)).
*5 - Opinion of Rosenman & Colin LLP.
23(a) - Consent of KPMG Peat Marwick LLP (included on page
II-7).
23(b) - Consent of Grant Thornton LLP (included on page
II-8).
23(c) - Consent of Rosenman & Colin LLP (included in
Exhibit 5).
II - 2
<PAGE>
24 - Power of Attorney (included on page II-6).
- ---------------------------
* Filed herewith
II - 3
<PAGE>
ITEM 9. UNDERTAKINGS
The undersigned Registrant hereby undertakes: (a) to file, during any
period in which offers or sales are being made, a post-effective amendment to
this Registration Statement to include any material information with respect to
the plan of distribution of the securities being registered hereby not
previously disclosed in this Registration Statement or any material change to
such information in this Registration Statement; (b) that, for the purpose of
determining any liability under the Securities Act of 1933 (the "Securities
Act"), each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and (c) to remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that, in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II - 4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Glen Cove, State of New York, on this 11th day of
November, 1997.
ACCLAIM ENTERTAINMENT, INC.
(Registrant)
By Gregory E. Fischbach
--------------------------
Gregory E. Fischbach
Co-Chairman of the Board and
Chief Executive Officer
II - 5
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Gregory E. Fischbach and James
Scoroposki, and each or either of them, his true and lawful attorney-in-fact and
agent, each acting alone, with full power of substitution and resubstitution,
for him and in his name, place, and stead, in any and all capacities, to sign
any or all amendments (including post-effective amendments) to this Registration
Statement, and to file the same, with all the exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, each acting alone, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises as fully, to all intents and
purposes, as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, each acting alone, or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
Gregory E. Fischbach Co-Chairman of the Board; November 11, 1997
- -------------------------- Chief Executive Officer;
Gregory E. Fischbach President; Director
James Scoroposki Co-Chairman of the Board; November 11, 1997
- -------------------------- Senior Executive Vice
James Scoroposki President; Treasurer;
Secretary; Director;
Acting Chief Financial
and Accounting Officer
Kenneth L. Coleman Director November 11, 1997
- --------------------------
Kenneth L. Coleman
Bernard J. Fischbach Director November 11, 1997
- --------------------------
Bernard J. Fischbach
Robert H. Groman Director November 11, 1997
- --------------------------
Robert H. Groman
James Scibelli Director November 11, 1997
- --------------------------
James Scibelli
Michael Tannen Director November 11, 1997
- --------------------------
Michael Tannen
II - 6
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
To the Board of Directors
Acclaim Entertainment, Inc.:
We consent to the use of our report dated November 5, 1997 incorporated by
reference in this Registration Statement on Form S-8 of Acclaim Entertainment,
Inc.
Our report dated November 5, 1997 contains an explanatory paragraph that states
that the Company's significant losses from operations in fiscal 1997 and 1996
and its working capital and stockholders' deficiencies at August 31, 1997 raise
substantial doubt about its ability to continue as a going concern. The
consolidated financial statements do not include any adjustments that might
result from the outcome of that uncertainty. The report also indicates that the
auditors were unable to review the fiscal 1996 selected quarterly data in
accordance with professional standards.
KPMG PEAT MARWICK LLP
New York, New York
November 10, 1997
II - 7
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
We have issued our report dated December 8, 1995 accompanying the
consolidated financial statements and schedule for the year ended August 31,
1995, included in the Annual Report of Acclaim Entertainment, Inc. on Form 10-K
for the year ended August 31, 1997. We hereby consent to the incorporation by
reference of said report in the Registration Statement of Acclaim Entertainment,
Inc. on Form S-8.
Our report dated December 8, 1995 contains an emphasis paragraph as to
uncertainty relating to the eventual outcome of certain class action lawsuits.
The fiscal 1995 consolidated financial statements do not include any provision
for any liability that might result upon the resolution of these matters.
GRANT THORNTON LLP
New York, New York
November 5, 1997
II - 8
<PAGE>
Exhibit 4(a)
<PAGE>
ACCLAIM ENTERTAINMENT, INC.
1988 STOCK OPTION PLAN
(as amended through September 17, 1997)
1. Purpose.
The purposes of this 1988 Stock Option Plan (the "Plan") are to induce
certain individuals to remain in the employ of, or to continue to serve as
directors of or as independent consultants to, Acclaim Entertainment, Inc. (the
"Company") and its present and future subsidiary corporations (each a
"Subsidiary"), as defined in section 424(f) of the Internal Revenue Code of
1986, as amended (the "Code"), to attract new individuals to enter into such
employment and service and to encourage such individuals to secure or increase
on reasonable terms their stock ownership in the Company. The Board of Directors
of the Company (the "Board") believes that the granting of stock options (the
"Options") under the Plan will promote continuity of management and increased
incentive and personal interest in the welfare of the Company and aid in
securing its continued growth and financial success. Options will be either (a)
"incentive stock options" (which term, when used herein, shall have the meaning
ascribed thereto by the provisions of section 422(b) of the Code) or (b) options
which are not incentive stock options ("non-incentive stock options"), as
determined at the time of the grant thereof by the Committee (the "Committee")
referred to in Section 3(A) hereof.
2. Shares Subject to Plan.
Options may be granted to purchase up to 25,000,000 shares of the
common stock, par value $0.02 per share (the "Common Stock") of the Company. For
purposes of this Section 2, the number of shares purchased upon the exercise of
an Option shall be determined without giving effect to the use by a Participant
of the right set forth in Section 8(C) hereof to deliver shares of the Common
Stock in payment of all or a portion of the option price or the use by a
Participant of the right set forth in Section 12(C) hereof to cause the Company
to withhold from the shares of the Common Stock otherwise deliverable to him
upon the exercise of an Option shares of the Common Stock in payment of all or a
portion of his withholding obligation arising from such exercise. If any Options
expire or terminate for any reason without having been exercised in full, new
Options may thereafter be granted to purchase the unpurchased shares subject to
such expired or terminated Options.
3. Administration.
(A) The Plan shall be administered by a Committee which shall consist
of two or more members of the Board, both or all of whom shall be "disinterested
persons" within the meaning of Rule 16b-
1
<PAGE>
3(c)(2)(i) promulgated under Section 16(b) of the Securities Exchange Act of
1934 (the "Exchange Act") and both or all of whom shall be "outside directors"
within the contemplation of section 162(m)(4)(C)(i) of the Code. The Chief
Executive Officer of the Company shall also be a member of the Committee,
ex-officio. The Committee shall be appointed annually by the Board, which may at
any time and from time to time remove any members of the Committee, with or
without cause, appoint additional members to the Committee and fill vacancies,
however caused, in the Committee. A majority of the members of the Committee
shall constitute a quorum. All determinations of the Committee shall be made by
a majority of its members present at a meeting duly called and held except that
the Committee may delegate to any one of its members the authority of the
Committee with respect to the grant of Options to a person who shall not be an
officer and/or director of the Company and who is not, and may not reasonably be
expected to become, a "covered employee" within the meaning of section 162(m)(3)
of the Code. Any decision or determination of the Committee reduced to writing
and signed by all of the members of the Committee (or by a member of the
Committee to whom authority has been delegated) shall be fully as effective as
if it had been made at a meeting duly called and held.
(B) Subject to the express provisions of the Plan, the Committee shall
have complete authority, in its discretion, to interpret the Plan, to prescribe,
amend and rescind rules and regulations relating to it, to determine the terms
and provisions of the respective option agreements or certificates (which need
not be identical), to determine the individuals (each a "Participant") to whom
and the times and the prices at which Options shall be granted, the periods
during which each Option shall be exercisable, the number of shares of the
Common Stock to be subject to each Option and whether such Option shall be an
incentive stock option or a non-incentive stock option and to make all other
determinations necessary or advisable for the administration of the Plan;
provided, however, that Outside Directors (as such term is defined in Section 4
hereof) who are members of the Committee shall only be granted Options in
accordance with the provisions of Section 4(B) hereof. In making such
determinations, the Committee may take into account the nature of the services
rendered by the respective employees, their present and potential contributions
to the success of the Company and the Subsidiaries and such other factors as the
Committee in its discretion shall deem relevant. The Committee's determination
on the matters referred to in this Section 3(B) shall be conclusive. Any dispute
or disagreement which may arise under or as a result of or with respect to any
Option shall be determined by the Committee, in its sole discretion, and any
interpretations by the Committee of the terms of any Option shall be final,
binding and conclusive.
2
<PAGE>
4. Eligibility.
(A) An Option may be granted only to (1) employees of the Company or a
Subsidiary, (2) directors of the Company or a Subsidiary who are not employees
of the Company or a Subsidiary ("Outside Directors"), (3) employees of a
corporation which has been acquired by the Company or a Subsidiary, whether by
way of exchange or purchase of stock, purchase of assets, merger or reverse
merger, or otherwise, who hold options with respect to the stock of such
corporation which the Company has agreed to assume and (4) independent
consultants who render services to the Company or a Subsidiary.
(B) On the first business day of each August, commencing in August
1992, each Outside Director shall be granted an Option to purchase 18,750 shares
of the Common Stock; provided, however, that the number of shares subject to an
Option granted to an Outside Director during the calendar year in which he
becomes an Outside Director shall be equal to 18,750 multiplied by a fraction,
the numerator of which shall be the number of regular meetings remaining during
such calendar year after his election as a director and the denominator of which
shall be four.
(C) The Committee may, with the approval of a majority of the members
of the Board of Directors, grant additional Options, in such amounts and at such
terms as the Committee may determine, to Outside Directors who perform services
for the Company and who are not members of the Committee at the time of such
grant.
5. Option Prices.
(A) Except as otherwise provided in Sections 5(C) and 17 hereof, the
initial per share option price of any Option which is an incentive stock option
shall not be less than the fair market value of a share of the Common Stock on
the date of grant; provided, however, that, in the case of a Participant who
owns (within the meaning of section 424(d) of the Code) more than 10% of the
total combined voting power of the Common Stock at the time an Option which is
an incentive stock option is granted to him, the initial per share option price
shall not be less than 110% of the fair market value of a share of the Common
Stock on the date of grant.
(B) Except as otherwise provided in Sections 5(C) and 17 hereof, the
initial per share option price of any Option which is a non-incentive stock
option shall not be less than 85% of the fair market value of a share of the
Common Stock on the date of grant.
(C) The initial per share option price of any Option which is granted
to an Outside Director shall be equal to the fair market value of a share of the
Common Stock on the date of grant.
3
<PAGE>
(D) For all purposes of this Plan, the fair market value of a share of
the Common Stock on any date, if the Common Stock is then listed on a national
securities exchange or traded on the NASDAQ National Market System, shall be
equal to the closing sale price of a share of the Common Stock or, if there is
no sale of the Common Stock on such date, the average of the bid and asked
prices on such exchange or system at the close of trading on such date or, if
the shares of the Common Stock are not then listed on a national securities
exchange or such system on such date, the fair market value of a share of the
Common Stock on such date as shall be determined in good faith by the Committee.
6. Option Term.
Options shall be granted for such term as the Committee shall
determine, not in excess of ten years from the date of the granting thereof;
provided, however, that, except as otherwise provided in Section 17 hereof, in
the case of a Participant who owns (within the meaning of section 424(d) of the
Code) more than 10% of the total combined voting power of the Common Stock at
the time an Option which is an incentive stock option is granted to him, the
term with respect to such Option shall not be in excess of five years from the
date of the granting thereof; and provided, further, however, that the term of
an Option granted to an Outside Director shall be ten years from the date of the
granting thereof.
7. Limitation on Amount of Incentive Stock Options Granted.
(A) Except as otherwise provided in Section 17 hereof, the aggregate
fair market value of the shares of the Common Stock for which any Participant
may be granted incentive stock options which are exercisable for the first time
in any calendar year (whether under the terms of the Plan or any other stock
option plan of the Company) shall not exceed $100,000.
(B) No Participant shall be granted Options during any calendar year to
purchase more than 400,000 shares of Common Stock, except that in calendar year
1994, no Participant shall be granted Options to purchase more than 450,000
shares of Common Stock.
8. Exercise of Options.
(A) Except as otherwise provided in Section 17 hereof and, in the case
of an Option granted to a person who shall not be an Outside Director, except as
otherwise determined by the Committee at the time of the grant thereof, a
Participant may (i) during the period commencing on the first anniversary of the
date of the granting of an Option to him and ending on the day preceding the
second anniversary of such date, exercise such Option with respect to one-third
of the shares granted thereby, (ii) during the period commencing on such second
anniversary and ending on the day preceding the third anniversary of the date of
the granting of such
4
<PAGE>
Option, exercise such Option with respect to two-thirds of the shares granted
thereby, and (iii) during the period commencing on such third anniversary,
exercise such Option with respect to all of the shares granted thereby.
(B) To the extent exercisable, an Option may be exercised either in
whole at any time or in part from time to time.
(C) An Option may be exercised only by a written notice of intent to
exercise such Option with respect to a specific number of shares of the Common
Stock and payment to the Company of the amount of the option price for the
number of shares of the Common Stock so specified; provided, however, that all
or any portion of such payment may be made in kind by the delivery of shares of
the Common Stock having a fair market value on the date of delivery equal to the
portion of the option price so paid; provided, further, however, that, subject
to the requirements of Regulation T promulgated under the Exchange Act, the
Committee may implement procedures to allow a broker chosen by a Participant to
make payment of all or any portion of the option price payable upon the exercise
of an Option and receive, on behalf of such Participant, all or any portion of
the shares of the Common Stock issuable upon such exercise.
(D) Except in the case of an Option granted to an Outside Director, the
Committee may, in its discretion, permit any Option to be exercised, in whole or
in part, prior to the time when it would otherwise be exercisable.
9. Transferability.
No Option shall be assignable or transferable except by will and/or by
the laws of descent and distribution and, during the life of any Participant,
each Option granted to him may be exercised only by him.
10. Termination of Service.
(A) Except as otherwise determined by the Committee at the time of
grant thereof, in the event a Participant leaves the employ or service of the
Company and the Subsidiaries prior to his 65th birthday, whether voluntarily or
otherwise but other than by reason of his death or "disability" (as such term is
defined in section 22(e)(3) of the Code), each Option theretofore granted to him
shall, to the extent not theretofore exercised, terminate forthwith.
(B) In the event a Participant's employment or service with the Company
and the Subsidiaries terminates by reason of his death, each Option theretofore
granted to him shall become immediately exercisable in full and shall terminate
upon the earlier to occur of (i) the expiration of the period of one year after
the date of
5
<PAGE>
such Participant's death and (ii) the date specified in such
Option.
(C) In the event a Participant leaves the employ or service of the
Company and the Subsidiaries on or after his 65th birthday or by reason of his
disability, each Option theretofore granted to him shall become immediately
exercisable in full and shall terminate upon the earlier to occur of (i) the
expiration of the period of three months after the date of such retirement or
disability and (ii) the date specified in such Option.
11. Adjustment of Number of Shares.
(A) In the event that a dividend shall be declared upon the Common
Stock payable in shares of the Common Stock, the number of shares of the Common
Stock then subject to any Option, the number of shares of the Common Stock which
may be purchased upon the exercise of Options granted under the Plan but not yet
covered by an Option and the number of shares of the Common Stock to be subject
to an Option to be issued to an Outside Director shall be adjusted by adding to
each share the number of shares which would be distributable thereon if such
shares had been outstanding on the date fixed for determining the stockholders
entitled to receive such stock dividend. In the event that the outstanding
shares of the Common Stock shall be changed into or exchanged for a different
number or kind of shares of stock or other securities of the Company or of
another corporation, whether through reorganization, recapitalization, stock
split-up, combination of shares, sale of assets, merger or consolidation in
which the Company is the surviving corporation, then, there shall be substituted
for each share of the Common Stock then subject to any Option, for each share of
the Common Stock which may be purchased upon the exercise of Options granted
under the Plan but not yet covered by an Option and for each share of the Common
Stock to be subject to an Option to be issued to an Outside Director, the number
and kind of shares of stock or other securities into which each outstanding
share of the Common Stock shall be so changed or for which each such share shall
be exchanged.
(B) In the event that there shall be any change, other than as
specified in Section 11(A) hereof, in the number or kind of outstanding shares
of the Common Stock, or of any stock or other securities into which the Common
Stock shall have been changed, or for which it shall have been exchanged, then,
if the Committee shall, in its sole discretion, determine that such change
equitably requires an adjustment in the number or kind of shares then subject to
any Option and the number or kind of shares available for issuance in accordance
with the provisions of the Plan but not yet covered by an Option, such
adjustment shall be made by the Committee and shall be effective and binding for
all purposes of the Plan and of each Option.
6
<PAGE>
(C) In the case of any substitution or adjustment in accordance with
the provisions of this Section 11, the option price in each Option for each
share covered thereby prior to such substitution or adjustment shall be the
option price for all shares of stock or other securities which shall have been
substituted for such share or to which such share shall have been adjusted in
accordance with the provisions of this Section 11.
(D) No adjustment or substitution provided for in this Section 11 shall
require the Company to sell a fractional share under any Option.
(E) In the event of the dissolution or liquidation of the Company, or a
merger, reorganization or consolidation in which the Company is not the
surviving corporation, the Board, in its discretion, may accelerate the
exercisability of each Option and/or terminate the same within a reasonable time
thereafter.
12. Purchase for Investment, Withholding and Waivers.
(A) Unless the delivery of the shares upon the exercise of an Option by
a Participant shall be registered under the Securities Act of 1933, such
Participant shall, as a condition of the Company's obligation to deliver such
shares, be required to give a representation in writing that he is acquiring
such shares for his own account as an investment and not with a view to, or for
sale in connection with, the distribution of any thereof.
(B) In the event of the death of a Participant, an additional condition
of exercising any Option shall be the delivery to the Company of such tax
waivers and other documents as the Committee shall determine.
(C) An additional condition of exercising any non-incentive stock
option shall be the entry by the Participant into such arrangements with the
Company with respect to withholding as the Committee shall determine; provided,
however, that such Participant may direct the Company to satisfy all or a
portion of such withholding obligation by withholding from the shares of the
Common Stock issuable to him on such exercise shares of the Common Stock having
a fair market value equal to the portion of the withholding obligation so
satisfied.
13. Declining Market Price.
Except in the case of an Option granted to an Outside Director, in the
event the fair market value of the Common Stock declines below the option price
set forth in any Option, the Committee may, subject to the approval of the
Board, at any time, adjust, reduce, cancel and re-grant any unexercised Option
or take any similar action it deems to be for the benefit of the
7
<PAGE>
Participant in light of the declining fair market value of the Common Stock.
14. No Stockholder Status; No Restrictions on Corporate Acts; No
Employment Right.
(A) Neither any Participant nor his legal representatives, legatees or
distributees shall be or be deemed to be the holder of any share of the Common
Stock covered by an Option unless and until a certificate for such share has
been issued. Upon payment of the purchase price therefor, a share issued upon
exercise of an Option shall be fully paid and non-assessable.
(B) Neither the existence of the Plan nor any Option shall in any way
affect the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Company's capital structure or its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stock ahead of or affecting the Common Stock or the rights
thereof, or dissolution or liquidation of the Company, or any sale or transfer
of all or any part of its assets or business, or any other corporate act or
proceeding whether of a similar character or otherwise.
(C) Neither the existence of the Plan nor the grant of any Option shall
require the Company or any Subsidiary to continue any Participant in the employ
or service of the Company or such Subsidiary.
15. Termination and Amendment of the Plan.
(A) The Board may at any time terminate the Plan or make such
modifications of the Plan as it shall deem advisable; provided, however, that
the Board may not, without further approval of the holders of the shares of the
Common Stock, increase the number of shares of the Common Stock as to which
Options may be granted under the Plan (as adjusted in accordance with the
provisions of Section 11 hereof), or change the class of persons eligible to
participate in the Plan, or change the manner of determining the option prices,
or extend the period during which an Option may be granted or exercised. Except
as otherwise provided in Section 16 hereof, no termination or amendment of the
Plan may, without the consent of the Participant to whom any Option shall
theretofore have been granted, adversely affect the rights of such Participant
under such Option.
(B) The provisions of Section 4(B) hereof may not be amended except by
the vote of the majority of the members of the Board and by the vote of the
majority of the members of the Board who are not Outside Directors, and the
provisions of said Section 4(B) shall not be amended more than once every six
months, other than to
8
<PAGE>
comport with changes in the Code, the Employee Retirement Income Security Act of
1974 or the Rules and Regulations thereunder.
16. Expiration and Termination of the Plan.
The Plan shall terminate on May 1, 1998 or at such earlier time as the
Board may determine. Options may be granted under the Plan at any time and from
time to time prior to its termination. Any Option outstanding under the Plan at
the time of the termination of the Plan shall remain in effect until such Option
shall have been exercised or shall have expired in accordance with its terms.
17. Options Granted in Connection With Acquisitions.
In the event that the Committee determines that, in connection with the
acquisition by the Company or a Subsidiary of another corporation which will
become a Subsidiary or division of the Company (such corporation being hereafter
referred to as an "Acquired Subsidiary"), Options may be granted hereunder to
employees and other personnel of an Acquired Subsidiary in exchange for then
outstanding options to purchase securities of the Acquired Subsidiary. Such
Options may be granted at such option prices, may be exercisable immediately or
at any time or times either in whole or in part, and may contain such other
provisions not inconsistent with the Plan, or the requirements set forth in
Section 15 hereof that certain amendments to the Plan be approved by the
stockholders of the Company, as the Committee, in its discretion, shall deem
appropriate at the time of the granting of such Options.
9
<PAGE>
Exhibit 5
<PAGE>
November 6, 1997
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Gentlemen:
We refer to the Registration Statement on Form S-8 to be filed by Acclaim
Entertainment, Inc. (the "Company"), a Delaware corporation, with the Securities
and Exchange Commission with respect to the registration of 10,000,000 shares of
the Company's common stock, par value $0.02 per share, for issuance under the
Company's 1988 Stock Option Plan (the "Plan").
We have made such examination as we have deemed necessary for the purpose of
this opinion. Based upon such examination, it is our opinion that said
10,000,000 shares have been duly authorized and, upon issuance in accordance
with the terms of stock option agreements or certificates issued under the Plan,
will be validly issued, fully paid and non-assessable.
We hereby consent to the use of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
ROSENMAN & COLIN LLP
By /s/
------------------------------
A Partner
JP
